The Rise of E-residency

Eric B. Schnurer, founder and president of Public Works LLC, a private consultancy agency, has written an article on Foreign Affairs about the coming digitalization of public services and governments. In it, he talks about the increasing commercialization of government services, like selling citizenships to anyone without any actual connection to  the countries themselves. He lists Malta and Bulgaria as examples and discusses the e-residency program of Estonia, whereby anyone in the world can become an Estonian e-resident and enjoy usage of the country’s leading online government services. 

The question after reading the article is that of competition. Will Estonia e-residency still be as attractive when other countries start offering their own version of an e-residency? Since the e-residents don't actually have any affinity for the country, mostly getting it for practical reasons, there's no actual loyalty or nationalism toward the country. It'll be as easy as changing banks and here lies the conundrum. Countries would want to promote the successes of their e-residency programs, but those very same successes would encourage competition. And when heavy players, in this case, countries with a large population and strategic advantages (Canada, Australia, South Korea, etc), start getting into the market, it leaves very little room for smaller countries. This is not to discount the advantages that the e-residency program is bringing to Estonia now — the largest number of startups per person in the world, a tech sector that accounts for almost 15% of its GDP, and an expected revenue of $565 million from people registering for e-residents (there is a registration fee after all)  but Estonia should have a plan of where to go from here.

Eric B. Schnurer cites Nevada as an example of a place that used a specific government service —rapid divorce certification — as an incentive to entice visitors during the Great Depression and that these "migratory divorces" reached its peak 1940s, bringing in nearly 20,000 visitors a year to the state. He states that these visitors fueled a boom that served as the foundation of Nevada’s tourist economy. This example illustrates the very same problem that Estonia will face. When Nevada's rapid rapid divorce certification was no longer unique to the state, it could no longer rely on it to fuel the economy. The state had to shift to something else entirely — gambling. 

So when Estonia's e-residency is no longer unique to Estonia, what is it going to do?